The Buckle Inc Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

The Buckle Inc Case Solution

(NYSE:BKE)

The name of the company is Buckle Incorporated. The ticker symbol is BKE. As per the Google finance, the summary financial information is given in the adjacent chart. As per the latest news, the company’s board has authorized $0.25 dividend per share quarterly that accumulates to $1 per share dividend annually. This announcement resulted in slight increase of 1.23% in share price at the start of the month of June (Quarterly Dividend, 2016).

The investment opportunity in the Buckle shows that the investors would increase their interest to hold the amount of shares if three factors would be considered in order to analyze the company’s future growth.

The first factor to consider is the maintenance ofequity margins along with high dividend per share in order to meet the investor’s long-term demand.
The second is to maintain the beat value under 1 because this would represent less risk under the price value.
The last factor to include would be linking the EPS rate with the related equity margin to sustain the position in future.

Company description

The Buckle Inc. is one of the leading retailers of casual apparel, footwear, and accessories for young men and women. The products are in price tag of medium and better-priced. The company was incorporated on August 30, 1948. The company was initially traded at NASDAQ then moved to New York Stock Exchange in 1997. One of the renowned brands of the company is Denim, besides this other brands include casual bottoms, tops, sportswear, outerwear, accessories, and footwear. The company has about 450 stores spread over 44 states inUS. It also provides customer services such as free hemming, free gift-wrapping, easy lay aways etc.

Investment Thesis

With the critical assessment of the company’s financial position in the long-term, it has been analyzed that some factors would contribute in increasing either the interest of shareholders to invest further or to hold the stock for the selected period of time. In detail, those factors are determined to maintain the position of the company’s future growth. In the past few years, Buckle’s position has been strong due to its well-maintained earning per share as well as established beta of the industry. While the company’s total earning declined over the year due to the increased shares outstanding because the shareholders contributed heavy investment due to the expected desired return associated with the company’s performance. It is also indicated that the debt to equity ratio is lower than the market industry expectations; this would maintain the dividend per share value under control due to the lack of interest payments of the long-term debt. This shows that a secured position would be held by the investors to receive greater profits. Therefore,these important factors would be considered to grow investor’s opportunity to hold the shares within the company and allow them to secure the investment for longer term due to strong historical financial results.

	Equity margin	Earnings Per Share	Beta	Ratings
Scenario 1	4	3	4	11
Scenario 2	3	4	3	10
Scenario 3	2	5	2	9

Key Risks

There were few risks that might affect the company’s future business potential and might affect the profitability of the company. There is high competition in the apparel industries. The company has been facing significant competition in the area of selection, quality, price, location, store environment, and service. The company has not been making capital expenditures. It is also stated in the annual report that there are several larger competitors who have strong financial position as compared to Buckle Inc. The company has exclaimed that it is uncertain about whether it will be able to compete against such competitors successfully. This places great risk on the company’s future business.............................

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The Buckle Inc Harvard Case Solution & Analysis